Calculating RRSP Contribution Room

Step 1: Earned Income

Alisha is a lawyer and she has the following sources of income:

a) Salary $75,000

b) Spousal Support $12,000

c) Interest Income $ 3,000

d) Capital Gains $ 5,000

In addition, Alisha has a rental property and she recorded a rental gain of $2,000.

What is Alisha's earned income for RRSP purposes?

Step 2: RRSP Contribution room for the current year

What is Alisha's current year contribution limit?

Step 3:PAs, PARs and PSPAs

Alisha belongs to a defined-benefit pension plan at the law firm where she works. It provides a benefit of 1.8% of best five years earnings. Her income last year was $73,600.

What is Alisha's pension adjustment?

Step 4:Putting it all together

Alisha's Notice of Assessment states that she has $47,000 in unused RRSP contribution room that has been carried forward from previous years.

What is Alisha's Total RRSP Contribution Room?